LukasI. Alpert

The contract to sell 700,000 tons to the Chinese National Agricultural Means of Production Group Corp. until the end of June indicates a possible end to the uncertainty in the potash market. Prices have fallen more than 25% from $400 a ton last summer, prompted by Uralkali leaving a trading partnership with Belarus and breaking an informal global pricing cartel.

"The contracts between Uralkali and the Chinese companies clearly testify to growing demand and the beginning of market recovery. The terms of the agreement with our Chinese partners are mutually beneficial and serve the interests of our consumers, agricultural producers of the [China]," said Oleg Petrov, Uralkali's director for sales and marketing.

China is the world's biggest consumer of potash and contracts signed there have previously been seen as setting the price for the global market.

Uralkali's July departure from the Belarusian Potash Co.--which controlled 40% of the $22 billion market--sent prices for fertilizer and potash mining stocks into a tailspin. At the time, Uralkali said it planned to pursue a volume-over-price strategy after years in which the industry collectively kept prices high by reducing supplies.

Earlier this month, Uralkali said its production was up 10% on year in 2013 to 10 million metric tons. The company has predicted that global demand will rise to 58 million-60 million tons in 2014, up from an estimated 53 million-54 million tons last year.

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